Examination of the relationship between entrepreneurial capital and the profitability of smallholder farmers in Analamanga’s rural areas

Abstract

Apprehending the role of entrepreneurship in economic success and poverty eradication is a fascinating topic, at the centre of scholars’ cares when inquiring into the field of new venture creation. This one-of-a-kind, ground-breaking study sought out to examine the nature of the relationship between entrepreneurial capital (entrepreneurial competence x entrepreneurial commitment) and the profitability of smallholder farmers in Analamanga’s rural areas. The use of a non-experimental cross-sectional survey was deemed to be most suitable for the purpose of the research. A cluster sampling method with a quota approach was adopted to determine the sample size and select the survey participants. The survey participants were questioned by a team of trained interviewers, equipped with a structured questionnaire, which served as a way to generate data that would be processed. Simple and multiple linear regression were the major statistical tests performed to analyse and interpret the data. The ensuing observations revealed a partially significant relationship between entrepreneurial competence and the profitability of smallholder farmers in Analamanga’s rural areas. A similar result was observed when testing the correlation between entrepreneurial commitment and profitability. Finally, the multiplicative interaction between entrepreneurial competence and entrepreneurial commitment - engendering the entrepreneurial capital paradigm - was proven to feature a significantly positive relationship with the dependent variable i.e. profitability. Considering the alarming magnitude of rural poverty in Madagascar, the outcomes of the study could function as the foundation of research-based policies and services delivered to smallholder farmers in the central region of the island to authentically satisfy their needs as a means to ensure their economic success and alleviate rural poverty in the country.